KGI Asia Commentary
HSI fell 6 points on Tuesday
The Hang Seng Index fell 6 points or 0.0% to 18,821 on Tuesday. HSTECH fell 9 points or 0.3% to 3,854 and HSCEI fell 2 points or 0.0% to 6,686. Daily market turnover was HK$97.7bn.
The Nasdaq closed above 17,000 points for the first time, led by Nvidia
On Tuesday, the Nasdaq closed above 17,000 for the first time ever, supported by a surge in Nvidia shares. The Nasdaq rose 0.6% to close at a record 17,019.88 points, the Dow Jones Industrial Average fell 216 points, or 0.6%, and the S&P 500 rose 0.1%. Nvidia's shares rose 7%, pushing the tech giant's market value to more than $2.5 trillion since its quarterly earnings report, solidifying its position as Wall Street's third most valuable company. Meanwhile, the market is focusing on Friday's release of the personal consumption expenditures (PCE) price index, which is widely seen as the inflation number on the Fed's radar. Personal consumption expenditures data on Friday are expected to show some cooling in inflation. But inflation will also be well above the Fed's 2% annual target range. The economic calendar also includes revised first-quarter economic growth data on Thursday and the Federal Reserve's Beige Book on Wednesday, and investors will also have the opportunity to hear from several Fed speakers this week.
Fed’s Kashkari said “I’m not seeing the need to hurry and do rate cuts.”
"I don't think there's any rush to cut rates," Kashkari said.
On Tuesday, Minneapolis Federal Reserve President Neel Kashkari said he would like to see " many more months" of data showing that inflation has eased before cutting interest rates. He also said he would not rule out further interest rate hikes if price pressures rise again. At the same time, survey results released by the Conference Board on Tuesday showed that consumer confidence unexpectedly rose in May, showing that consumer confidence, the main force driving U.S. economic growth, is strong. Traders continue to price out expectations for a rate cut in September. CME Fedwatch tools show traders expect a 50.7% chance of the Fed keeping interest rates unchanged and a 43.6% chance of a 25 basis point rate cut.
Hong Kong Stock Connect had a net inflow of HK4.16bn on Tuesday, of which Tencent (700) had the largest net inflow, reaching HK$0.58bn; followed by CNOOC (883). Tracker Fund (2800) recorded the largest net outflow at HK$1.0bn, followed by ICBC (1398).
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